The Coffee Bean & Tea Leaf is widely credited with kickstarting the frozen coffee craze. As the story goes, a store manager combined chocolate powder with milk, ice, and coffee extract in a blender one hot summer day back in 1987. She ended up creating the chain’s original ice-blended offering.

Cold beverages are hotter than ever nearly 40 years later. Creamy frozen treats, iced coffees, and cold brews have eclipsed traditional hot drinks as the preferred format for getting a caffeine jolt. Brands are continuing to place big bets on what is now their fastest-growing product category.

Sanjiv Razdan, president of the Americas and India for The Coffee Bean & Tea Leaf, says younger consumers are driving the shift toward those offerings, which boast a broader range of flavors and toppings, plus a strong visual appeal that’s perfect for sharing on social media. They’re also consuming coffee later in the day instead of solely as a morning breakfast drink.

“The afternoon pick-me-up is becoming cold, the weekend treat is becoming cold, and even the morning routine coffee is being consumed cold,” Razdan says. “We’re doing a lot more innovation around that, making sure we’re layering in flavors that really show up best when the drink is consumed that way.”

Those flavors are getting bolder and more global. He points to the brand’s horchata platform as an example. Launched earlier this year, it features both a hot and iced latte along with two cold brews, an ice-blended option, and a horchata cold cream that can be added to just about anything on the menu.

“People are becoming much more adventurous,” Razdan says. “What we’re doing is taking interesting flavors from around the world and bringing them to our customers in a very accessible way.”

New Orleans-based PJ’s Coffee is combining trending flavors like rose and lavender with more familiar flavors like strawberry and white chocolate to spark curiosity. It also is finding success with specialty drinks that bring a taste of its hometown to customers across the country, like the shaken cold brew espresso with creme brulee sweet cold foam.

“Coffee consumption has turned from a need-to-have and become more about indulgence, more about hitting that gratification checkbox instead of just having a source of caffeine,” says VP of marketing Reid Nolte. “There’s been a lot of demand for escapism lately, and with us being from New Orleans, that’s kind of our bread and butter.”

Indulgent and eye-catching drinks are a key traffic driver, but the quality of the base coffee is equally important. That’s because the uptick in at-home consumption during the pandemic sparked a fresh wave of interest in specialty coffee. Consumers educated themselves on different processing methods and roast profiles, with sales of home-brewing equipment skyrocketing as they sought to recreate restaurant-quality drinks in their kitchen.

“The demand that you find yourself contending with is making certain to keep up with trends so that whatever they can do at home, you can do better and more attractively, from the base coffee all the way up to the creativity of a sweet cold foam,” says Felton Jones, chief roastmaster at PJ’s Coffee. “Today’s coffee consumer is smarter and wants more. As a retailer, as a roaster, as a wholesaler, you have to take that seriously and build on that.”

Black Rock Coffee cofounder Jeffrey Hernandez always has an eye on revolving flavor trends to keep the brand’s beverage menu fresh and relevant. Still, he says coffee is a ritual, and “most people return to their habitual order pretty quickly.” That’s especially true for customers who stop by in the morning as part of their daily routine.

“It’s still the biggest piece of the pie, but we’re seeing growth in all of the other segments,” says fellow cofounder Daniel Brand. “That’s where the innovation side comes in. It’s about drawing more guests in at different dayparts with products that skew more midday and afternoon.”

Like many of its competitors, Black Rock is becoming less of a coffee specialist and more of a beverage generalist. Brands are growing traffic beyond the breakfast rush with new products that cater to different need-states and use occasions, like energy drink mix-ins and other boosted beverages.

Starbucks was an early mover with its Refreshers platform that features green tea extract. Dutch Bros. has its Rebels lineup, which accounts for roughly a quarter of its sales. Plenty of other brands, from national chains like Tim Hortons and Dunkin’ to emerging players like Ellianos Coffee and Ziggi’s Coffee, are generating strong sales through energy drinks.

Razdan says the popularity of tea has steadily grown over the past few years, driven by an increasing variety of options and the expanding popularity of matcha and bubble tea on coffee shop menus. The Coffee Bean & Tea Leaf is tapping into that momentum with a new World Tea Collection. It features items like oolong tea with a berry puree and freeze-dried strawberries. There’s also a Ceylon milk tea with brown sugar boba, a matcha latte with strawberry cream, and a chai drink with black tea, cinnamon, salted caramel cream, and a brown sugar waterfall.

Black Rock plans to continue leaning deeper into coffeeless offerings, thanks to ongoing growth in items like matcha lattes, chai lattes, and shaken iced teas, along with its energy drink platform.

“We love those products because they skew a lot younger and serve as a base for a ton of other innovations,” Brand says. “We’re adding things like a slushy version of our energy drink, and we’re doing a lot of innovation around tea, mixing it with lemonade and soda or water or adding in dried fruit.”

PJ’s is also driving traffic during the p.m. hours with non-coffee items like boosted teas and Red Bull infusions. They’re attracting a younger demographic that hasn’t fully embraced coffee—at least not yet.

“I think millennials were introduced to caffeine through Frappuccinos and frozen blended products,” Nolte says. “Now, Gen Z and Gen Alpha are being introduced to caffeine through boosted teas and infusions. When they graduate to coffee, we’ll be ready for them.”

Beverage, Fast Casual, Fast Food, Menu Innovations, Story, Black Rock Coffee Bar, Coffee Bean & Tea Leaf, PJ's Coffee